The Pakistan Stock Exchange set a new record as trading commenced on Tuesday, with the benchmark KSE-100 Index surpassing the 60,000 mark. This significant milestone followed the signing of multiple Memorandums of Understanding (MoUs) between Pakistan and the United Arab Emirates (UAE) a day earlier.
Caretaker Prime Minister Anwaarul Haq Kakar highlighted the signing of several multi-billion dollar MoUs during his visit to the UAE, emphasizing their role in elevating economic and strategic collaboration between the nations.
Closing at 60,730.26, the KSE-100 Index demonstrated a gain of 919.92 points or 1.54% from its previous closing of 59,811.34. The trading session observed a substantial increase, with a trading volume surpassing 336 million shares, marking approximately a 20% surge compared to the previous session's 276 million shares.
Several factors contribute to the ongoing stock surge, predominantly driven by increased foreign currency inflow. Foreign Direct Investment (FDI) is anticipated to rejuvenate the economy by expanding existing businesses and fostering new ones, offering crucial employment opportunities amid soaring costs of living caused by record-high inflation.
The anticipated FDI surge is expected to elevate share prices, particularly in energy and related sectors, marking a significant shift from a historically undervalued status.
Presently at 22%, Pakistan faces its highest interest rates, causing economic challenges due to increased costs of doing business. The devaluation of the rupee and the government's actions to counter this, alongside the IMF's emphasis on expanding the tax base and revenue collection, aim to formalize the economy, reducing the profitability of informal sectors.
These measures are likely to attract more investors to Pakistan's stock market, aiming to address the country's historically low population ratio when it comes to investing in the share market.
